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Budget Impact to the Army Briefing at the Pentagon

CAPT. JOHN KIRBY, DEPUTY ASSISTANT SECRETARY OF DEFENSE FOR MEDIA OPERATIONS: Well, good morning everybody, and thanks for being here. It's my pleasure to bring back to you in the briefing room General Ray Odierno, the 38th Chief of Staff of the United States Army. General Odierno will be here to speak about the new recently -- the recently released DOD strategic guidance and its impacts on the Army as that service transitions over the next few years.

I'll be moderating the discussion today, so please wait for me to call on you, and if you can limit your follow-ups so we can try to get everybody in as much as we can.

We've got about 30 minutes today. And with that, sir, over to you.

ARMY CHIEF OF STAFF GENERAL RAYMOND T. ODIERNO: I have about an opening statement, about 10 minutes. And then what I want to do is then open it up for any questions that you might have.

First, it's great to see you. Thanks for coming out on this Friday morning.

Over the past 236 years the history of the United States Army has been marked by decisive action in a wide range of missions, including regular/irregular warfare, humanitarian assistance operations, engaging with allies to build partner capacity and support to civil authorities.

Over the last decade our Army has been fully committed to combat operations in Iraq and Afghanistan. Secretary McHugh and I are incredibly proud of the work our soldiers and civilians have accomplished in these two countries and elsewhere. We do remain a nation at war, committed to the mission in Afghanistan.

We also remain an Army that is globally engaged. Currently we have 90,000 soldiers deployed in support of operations and another 96,000 soldiers forward-stationed overseas. Our nation's Army has soldiers located in nearly 150 countries around the world.

Moving forward, our Army remains mindful of our primary purpose: to fight and win our nation's wars. This role is non-negotiable.

War fighting alone, however, is not all that our nation requires of its Army. In today's complex and uncertain strategic environment, it is imperative that our Army remains responsive to the geographic combatant commanders and is a decisive arm of the Joint Force.

The Army provides depth and versatility to the Joint Force through the capabilities embedded in our Active, Guard and Reserve components. Meeting the challenges of an uncertain, complex and interconnected strategic environment requires an Army that is adaptive and innovative, flexible and agile, integrated and synchronized, lethal and discriminate.

With that in mind, our Army must retain the right capacity and diversity to perform a wide range of missions and provide a variety of military options to our national security leaders.

The President and the Secretary of Defense recently provided new defense strategic guidance to focus our efforts. The creation of this strategy was inclusive and comprehensive, and Secretary McHugh and I were deeply involved in this unprecedented and collaborative process.

And the defense strategic guidance was clear: We will strengthen our presence in the Asia-Pacific region; we will remain globally vigilant, especially in the Middle East; and we will continue to build and strengthen critical partnerships and alliances around the globe.

Over the last five years, we grew the Army to meet the requirements associated with large-scale combat and stability operations in Iraq and Afghanistan. With the successful completion of our mission in Iraq, the continued transition of operations to Afghan security forces and the reduction of U.S. presence in Afghanistan, our strategy calls for us to no longer plan for large-scale stability operations.

Accordingly, the time is strategically right to reduce the Army's force structure. Even given a fiscally constrained environment, our Army will accomplish our reductions in a responsible and controlled manner. Secretary McHugh and I are committed to ensuring we walk down this hill at the ready rather than running our nation's Army off a cliff. We will reduce our active force end strength from 570,000 to 490,000, which will include a reduction of at least eight brigade combat teams.

It is important to note, however, that an Army of 490,000 in 2017 will be fundamentally different and more capable than the Army of 482,000 that we had in 2001.

We are an Army that is seasoned by combat. We will continue to increase our investment in special operations forces and the cyber domain. We've drastically improved our command and control capabilities, significantly enhancing mission command. We've modularized our brigade combat teams, making them more capable and lethal. We've increased our aviation assets. Our National Guard and Reserves are truly an operational reserve, giving us increased depth and capacity.

Finally, we will leverage the lessons learned from 10 years of combat as we look into developing what our future force might look at. Going forward, the Army has three principal and interconnected goals: prevent, shape and win.

We prevent conflict. We do this by maintaining credibility based on the Army capacity, its readiness and modernization to prevent miscalculation by potential adversaries.

Moreover, the Army has a critical role in shaping the environment by supporting Combatant Commanders and sustaining strong military relations with allies, building the capacity of partners to maintain internal and regional stability and operating alongside our joint forces to facilitate access around the world.

And we stand ready to win our nation's wars when needed. If all else fails, the Army will always be ready to rapidly apply its combined arms capabilities to dominate any environment and win decisively as part of the Joint Force.

As we look ahead, the Secretary and I have several priorities. Foremost, we will provide trained, equipped and ready forces to win the current fight. Second, we will develop the Army for the future as part of Joint Force 2020, a versatile mix of capabilities, formations and equipment. We must sustain our high-quality, all-volunteer Army.

We will continue to transform the ways we modernize equipment by better aligning requirements, resources and the acquisition process.

We must invest in energy initiatives in order to reduce the cost of energy within our budget. We will adapt leader development to meet our future security challenges. And finally, we will foster continued commitment to the profession of arms, a noble calling founded on the bedrock of trust, which will be key as we move forward and develop our future Army.

We are an Army in transition. While continuing our missions abroad over the next several budget cycles, we'll refine, adjust and adapt as we move the Army towards the future force needed.

Our approach to the current future budget cycles will remain strategy-based and fiscally prudent. Adjustments will come through deliberately balancing three rheostats: the first piece consisting of an end-strength force structure and personnel; second, modernization; and third, readiness.

First, we will continue to meet our commitments in Afghanistan and around the world. The Army will continue to play a large role in the missions identified in this strategic guidance, including counterterrorism, irregular warfare, deter and defeat aggression, projecting power, defending the homeland, providing support to civil authorities, and conducting stability and counterinsurgency operations.

We will increase engagements with allies and new partners in the Asia-Pacific region, home of seven of the 10 largest armies in the world, to enhance our collective security, then promote economic prosperity. We must utilize our depth to sustain relations with our friends and allies to ensure stability by building partner capacity in the Middle East. We will decrease our European footprint by two heavy brigade combat teams, with the first one coming out of Europe in 2013. In order to continue our strong engagements with NATO and other European partners, we will deploy rotational forces to conduct training and readiness exercises with our allies and our new partners.

In Latin America, Africa and elsewhere, we will use innovative, low-cost and small-footprint approaches to conduct engagements, maintain stability and build partner capacity.

End-strength reductions will occur over the next six years. We will follow a drawdown ramp that allows us to take care of soldiers and families while maintaining a ready and capable force to meet any requirements, including our current operations in Afghanistan. We will also continue to look at the optimum design of our brigade combat teams and enable units, leveraging the lessons learned in combat. This analysis is ongoing and we do not expect any decisions for several months, but it could lead to a reduction of additional brigades if we decide to increase the capability of our current brigade combat team structure.

The National Defense Authorization Act and the DOD budget request of 2013 reflects the Army's modernization priorities. That includes the network, a replacement for our infantry fighting vehicle, the joint light tactical vehicle, and our soldier systems.

As force requirements continue to decrease in Afghanistan, we will reshape the Army's force generation model. We will implement a progressive readiness model that meets Combatant Commander requirements and takes advantage of our combat experience in both our Active and Reserve components. This requires continual balancing between force structure, manning, training, equipping and modernization. This will ensure we maintain readiness across the entire force, and avoid tiered readiness. And we will continually revisit the balance over the next several years of transition, to ensure sustained readiness.

As we look to the future, there are efficiencies we need to reduce costs. Secretary McHugh's direction has been clear in this regard.

Energy security requires us to focus on reducing our energy requirements, both in terms of operational fuel usage, but also home station initiatives.

We need to continue to find efficiencies and reduce the cost of doing business as part of a mitigating risk to our strategy. This includes eliminating redundancies and streamlining our headquarters.

In terms of pay and benefits, the Secretary and I agree with the Secretary of Defense's budget request. The All-Volunteer Force is the foundation of our military, but the cost of military personnel has grown at a substantial, unsustainable rate over the last decade. We will not reduce pay, but reductions must occur in the rate of growth in military compensation and other personnel-related costs and benefits. It is imperative that during this transition in end strength reduction, we maintain a commitment to our soldiers and families that is commensurate with their service and sacrifice.

Today, the Army ensures mission accomplishment, guarantees national security interests, compels adversaries, prosecutes military campaigns and forges a positive difference around the world. It is what the American people expect, and what our own freedom demands.

The Secretary and I will continue to assess and make adjustments as necessary to ensure we have the right Army that is agile, flexible and prepared for a full range of operations and threats.

Thank you very much. That ends my prepared comments. And I'd like to open it up for questions.

CAPT. KIRBY: Rita.

Q: All right. General, can you expand just a little bit on the European plans, particularly in light of -- as you take two [brigade combat teams] out? Can you give us also the date they are -- the second one will be coming out? And can you just talk a little bit how you -- how you envision support for NATO allies, how you envision support for some of the smaller allies that have been participating in Afghanistan, for example? And also, are the two heavily armored divisions -- brigades -- that are coming out, do you see them going away, or will they just get moved to a different location?

GEN. ODIERNO: First, the plan is to have one brigade come out in '13 and the second brigade would come out in '14. That's the current plan. They will come out of the force. They will not be re-stationed back in the United States. That's the plan right now as we look at this.

As we look ahead, I really see this as a model of how I see us doing things in the future. What we're going to do is, we'll have a rotational base out of the United States as we do our force generation. We will rotate units -- for example, into our training -- our training complex we have at Hohenfels/Grafenwoehr -- that allow us to train with our NATO partners and also with some of our other partners in Europe. And we'll be able to do that at several levels -- at battalion level, at company level, across several different domains.

And in reality, I think, in the long run, this will benefit all of us. It'll cause more of our units to get involved in working with our NATO partners. It won't just be limited to those stationed in Europe. And I think we'll be able to tailor our engagements based on their needs. So, for example, we want to do a higher headquarters exercise, we send a larger headquarters. If we want to have a light unit go, we can have a light. If we want a Stryker unit to do it -- or heavy unit -- so it'll enable us to really, in my mind, diversify our relationships with our -- with our NATO partners.

So I actually see, if we do this properly -- and I'm focused on this -- we will be able to make this actually an advantage to us as we move forward.

CAPT. KIRBY: Thom.

Q: Thank you. General, thank you for your time this morning. I wanted to talk about the balance between end strength and the national strategy. At AUSA [Association of the United States Army annual meeting] last year you led us through a very thoughtful discussion about how before 9/11, at 480[,000], the Army was supposed to implement was supposed to implement a two-war strategy. Gosh, there just wasn't enough there.

GEN. ODIERNO: Yeah.

Q: You say you're comfortable dropping to 490[,000]. Share with us, sir, if you would, what about the new strategy is different enough to give you that comfort level?

GEN. ODIERNO: Well, the fundamental principle in the strategy says that we aren't going to do long-term stability operations. And that's what drove the increase in our end strength, the fact that we were engaged in Iraq and Afghanistan for eight and 10 years.

And so the thought process is we might do -- we'll still do stability, but it would be at a much smaller scale, and we'll rely more on other partners to assist us as we do stability operations.

So, we know we have a lot of uncertainty out there. So if, in fact, we end up having to do a large-scale stability operation, we will depend on our ability to reverse and expand, which would be highly dependent on the Reserve component initially in order for them to help us to meet our initial requirements, which would then buy us time to potentially look at re-expanding the Army again. And that's the thought process behind it. And I feel comfortable with that strategy.

Q: I'd like to follow up on Tom's question about troop strength. We keep hearing that one of the things that you're concerned about is not hollowing out the force. And yet we're going back to a figure that pre-9/11 that was essentially considered a hollowed-out number. So you're talking about expanding. You're -- in terms of where the United States goes and the missions it conducts itself in. Why was that number considered a hollowed-out force number 10 years ago, and now as you talk about more missions, it's not?

And also, could you give us any more details about restarting BRAC and where that would be?

GEN. ODIERNO: Yeah, sure. First, I don't think -- I didn't believe the force was hollow back pre-9/11. I think we had some problems in the late '90s when we came down a significant number, almost over 300,000 in the Army and the way we did that. And I think we recovered from that.

But I will say as I look at the 490,000 number, it's about how that matches up with the force structure. And what hollowness means is if you have structure in there that is not ready. So in other words, you can have a lot of structure, but if you don't have the money to sustain training, to ensure they're equipped properly or to ensure we have it manned properly, then you have a hollow force.

I believe, with how we are right now, we will be able to do that at the 490,000 level, and that's the thought process behind it.

In terms of BRAC, I think they're going to ask two more BRAC rounds. Not sure when that will be. We still have to obviously work that with Congress. And that'll be something we -- so we expect -- we're going to request that we go through two more BRAC rounds. And so we'll have to wait to see -- we have to work that with Congress, and we'll see what their thoughts are on that.

I don't see -- the one thing -- you know, we -- the Army went through a very significant BRAC here not too long ago. And we did a fairly significant consolidation within the Army. So for the Army, I believe a follow-on BRAC would be -- would not have as much impact on the Army because we've pretty much done what we want to. We'll have to do some minor things, I think, probably, as we go through BRAC. They'll find some things that we have to -- but I think, for the most part, we have established our installations.

What you'll see around the Army -- except for some for the overseas places that we'll close, but in the -- in the continental United States and Alaska and Hawaii, you might see a reduction in the installations. But I don't think that you see a big installation being asked to close as we -- (inaudible). We think we have the right footprint. But we'll see; we'll work our way through those as we go forward.

Q: With regard to your aviation assets, there was mention in the white paper yesterday about delaying some modernization for helicopters. Can you add some granularity to that?

GEN. ODIERNO: Well --

Q: And also, if you don't mind, does that affect AAS [Armed Aerial Scout]? And then I'd also like to ask you about the Air Force's decision to terminate C-27J. That's been a controversial issue between the two services. Do you plan to sign the MOU [Memorandum of Understanding] that's being drawn up to provide direct support without that C-27J?

GEN. ODIERNO: Yeah, first, with the aviation, we have all the modernization in the program that we need. We've slowed it down a bit, but we're very comfortable with that because of the reset that we're doing with all our aviation assets as it comes out of the war zones in Iraq and Afghanistan. So we're still doing reset, we are still continue to modernize our fleet, but it'll be at a bit of a slower pace and we're fairly comfortable with that.

In terms of the C-27 -- I signed the MOU this morning, actually, before I came down here -- we've been working this for a few months. It's important to us that we have direct support to our units out in Afghanistan and wherever we might deploy. It's a concept actually we tested while I was the commander in Iraq, and I thought it was a very successful test. So it's -- I think it's -- I'm comfortable with that. So we'll mitigate the loss of the C-27. I'm not sure we'll be able to completely mitigate it, but that will help at least, as we're deployed, to mitigate that problem.

Q: OK, then -- (off mic) -- is that part of the delay of the helicopter -- (inaudible)?

Q: General, do you feel that the Army is shouldering the bulk of the burden of this -- these defense budget cuts? When we look on paper it sure looks like you're taking the biggest hit.

GEN. ODIERNO: Sure.

Q: And also, how did you come up with the number 490? Is that budget-based or what were the considerations?

GEN. ODIERNO: Sure. First, the -- I really -- I want to be very clear. This is not about winners and losers. This is about coming up with the right Joint Force.

I believe the Army grew over -- more than anybody else over the last five or six years, as we got involved in Iraq and Afghanistan, and that growth was very specific. Because we were worried about the op tempo of our soldiers in our units, we grew the Army in order to meet our commitments in Iraq and Afghanistan. So I think it's -- I'm comfortable now that, in fact, our -- we're done with Iraq, our commitments are coming down in Afghanistan -- that we can now do this. So I don't see it as we're bearing the burden of it; I -- I'm saying we're making a correction based on what we see out there as a potential threat.

Now, in terms of strategy, what I look at is, what does 490,000 get me? So what we're doing is we're increasing our special operations forces. We're going to go to 35,000 total special operations forces in the Army. And I think it's important to understand that this is significant growth. We've been doing this over the last three or four years. And I want to re-emphasize the incredible missions and roles that they play and what they're been doing over the last 10 years in Iraq, Afghanistan, around the world. And we want to continue that. We think that's the way of the future.

And I also -- it is now the relationship that's been built between our special operations and conventional forces. The synchronization and integration that we've gained in Iraq and Afghanistan we will now carry forward as we continue to conduct our other missions around the world, and I see that as a factor moving forward.

Then I look at the number of brigade combat teams and I feel comfortable -- although, as I mentioned, right now we're planning on reducing -- we're looking at a reorganization, that could potentially make it reduce further, but the capability that we would have behind would allow us to execute the strategy that we're talking about. So I feel comfortable with where we're headed, and that's how we got to that number 490,000.

Q: And you mentioned in Asia that seven of the top 10 armies are -- the largest armies -- are in Asia.

GEN. ODIERNO: Right.

Q: And you also mentioned the deterrent effect of having a large -- you're worried -- are you worried that you're sending a signal that you're reducing the size of the Army yet just as they're pivoting towards Asia, where there are these larger armies?

GEN. ODIERNO: Yeah, I'm convinced that with the Army that we have left behind, the number of division and brigade combat teams in fact, and I didn't mention, we've also increased our aviation capacity -- and our special ops force capacity gives us enough to deter and to -- (inaudible) -- to know that we are capable of moving this army anywhere in the world, being more capable of moving quicker, being more responsive, that will allow us to answer those -- those issues.

Q: Sir, can you explain the purpose and goals of these low-cost operations in Africa and Latin America?

GEN. ODIERNO: Well, first off, it's about -- it's about continuing to stay engaged and continuing to build partner capacity and build relationships with the leaderships -- leadership within all of these nations.

And we can do that across several ways. We can do it, first, with special operations forces. We can do it with unique forces such as engineers, medical. We can do it with aviation. So they would be more niche forces, which would help them to build capacity that they don't have. So it's those kind of things that I think we'll do more of in Africa and in South America, for example.

And I think we have the capacity and capability to do it. That's what the depth that the Army brings to the Joint Force is, that we have the ability to bring other capabilities to these nations that not all the other services can. And I think that's our strength.

And so although we will be more focused on the Asia-Pacific and Middle East, we will have the capacity in order to do these small- scale events, whether they be training events or building partner capacity or bilateral events that will allow us to continue to establish these relationships. So it's really the relationships that are the most important.

CAPT. KIRBY: Tony, in the back.

Q: Sir, the 490[,000] cut, roughly what's the savings there over this future defense plan? Of the $259 billion, what's the Army's contribution to that figure?

GEN. ODIERNO: Yeah, Tony, you know, I keep wanting to be able to give a number to this, but it's so complex and convoluted because -- the reason I say that is it's not only just people reductions; it's not only benefit reductions. It'll be the reduction in equipment that we have that goes out. It's the reduction of training dollars. It's -- and so we'll work our way through this number. But in the end, it'll be -- it'll be upwards of -- you know, it'll be a fairly significant number.

But I don't want to put a number on it, because I don't think I'll be accurate if I give it to you, frankly.

Q: All right. But what system -- the ground -- your combat ground system -- you know, it was -- yesterday it was listed in this -- the cuts or reductions. It's -- the GAO cleared a protest recently, so I thought the program was going forward.

GEN. ODIERNO: It is. It is.

Q: What the -- can you --

GEN. ODIERNO: The reduction is $1.7 billion, and it's because of the -- it was because of the challenge. We had to delay it because of the challenge, and so we couldn't spend the $1.7 billion. So we reduced that. So we -- what happens is, the program's now moved a year.

Q: OK.

GEN. ODIERNO: So $1.7 billion was taken out because of the protest. Now the protest is done. We're moving forward with the Ground Combat Vehicle. And we're comfortable with the program.

CAPT. KIRBY: We got time for just two more.

Q: General, historically, when there have been major security challenges and it's involved partners, a coalition of partners, I think I'm right in saying that the partners have always relied on America to provide the boots on the ground and they've latched on -- few thousand here, a few thousand there.

Are you now saying to your -- particularly your European partners, ‘sorry, we're not going to provide the biggest force anymore; you're going to have to provide a hell of a lot more?’ And is that realistic, seeing how the Europeans are cutting back too?

GEN. ODIERNO: Yeah, I don't think that's what we're saying. I mean, I still think we're going to have plenty of capacity to lead, if asked to lead, with boots on the ground, depending on the operation. I think we have the capacity to do that. We'll continue to have that.

We certainly are going to need our partners to move along with us as we do this, but I don't think there's any greater expectation that they would provide more. I think what we want to do is continue to do what we have been doing, and we have built strong partnerships as we address challenges around the world.

CAPT. KIRBY: This will be the last one.

Q: It's a very short one, so maybe another.

Which of the four brigades in Europe -- I mean, which are the two brigades you would reserve from Europe?

GEN. ODIERNO: Yeah, we're still -- we're still working our way through that. It'll probably be another couple of weeks, and we'll announce which two they are.

Q: But can you say any more than -- (cross talk) -- with all due respect, there's only two heavy brigades in Europe, so we can do the math ourselves.

GEN. ODIERNO: We'll announce in a couple of weeks, Thom.

CAPT. KIRBY: This will really be the last one.

Q: Following on Michael's question, have any of your counterparts in Europe, or specifically in Germany, expressed specific concern about not just withdrawing the Army, but then all the families? And their economies are tough there, too. And then, specifically about the drawing down, the 80,000. When will that start? Is that going to begin before the war in Afghanistan is going to end -- (inaudible) 2014?

GEN. ODIERNO: First, we have been working very closely with Jim -- Admiral Stavridis, Jim Stavridis, who's been working this with them. And we have been talking about this for several months, how we would mitigate this. And I think, actually, that they're somewhat pleased with the mitigation strategies we have in place. Now, we'll still have some capability over in Europe, so I think we will be able to work through that.

The thing I would tell you about the drawdown is, there's two things I was concerned about as we started to have this discussion; first with the number as 490[,000], but how we get to 490[,000], and that was the most important thing to me. And we'll start this year, actually. Because if you remember, we had already committed to going down to 520[,000], and so we're starting this year to take some structure out. But we've been able to move it out across a six-year period, from '12 to '17. So by doing that, it's spread evenly. It allows us to downsize, to take care of soldiers and families. We hope to do it mostly by attrition. There might be some things we have to -- other things we have to do, but we're trying to do most of it by attrition.

And it also accounts for our commitments in Afghanistan. And so we're going to be able to sustain our commitments in Afghanistan and get it to the right tempo, OPTEMPO [operational tempo], that we need in order to provide enough dwell time for our -- for our soldiers and families. So that was part of this.

And to me, as important as the 490[,000] number was the fact that we were able to do this over a six-year period.

Q: And will it be evenly split over the six years?

GEN. ODIERNO: It's not exactly even. It -- because we do it based on -- it's based on what we call cohorts that come in. So for example, three or four years ago we were bringing in large cohorts. So it's easier to -- we might reduce those a little bit more than we do the ones that we do in '15 or '16. But we have worked this very carefully against our requirements, and so we've been very thoughtful in doing this. This was really very important to me as we walk through this -- work through this process.